Berman Tabacco serves as a member of Lead Plaintiffs’ Counsel’s Executive Committee representing Alphabet shareholders in a derivative action filed against certain officers and directors of Alphabet, Inc.’s board. The consolidated cases are pending before the Honorable Brian C. Walsh in the California Superior Court in Santa Clara County.
Shareholders allege that these officers and directors breached their fiduciary duties to the Company by participating in or disregarding a culture of sexual harassment and discrimination that persisted for years and resulted in a hostile work environment at Alphabet (commonly referred to as Google). Shareholders further allege the board breached their fiduciary duties by failing to implement and maintain an effective system of internal controls resulting in Alphabet’s failure to ensure the privacy of its 500,000 Google+ users’ personal data and the Company’s false and misleading statements regarding its privacy protections. Taken together, the case alleges that the Company’s officers and directors who participated or acquiesced to this “culture of concealment” protected the interests of top-earning executives at the expense of the Company’s shareholders, employees and users, and caused the tech giant financial and reputational damage.
The case settled for significant and meaningful workplace reforms, including governance reforms to the company’s board of directors designed to prevent sexual harassment, sexual misconduct, discrimination, and retaliation. As part of the settlement, Alphabet established and will maintain for at least five years a Diversity, Equity, and Inclusion Advisory Council, which will be responsible for overseeing the creation, implementation, and ongoing operation of the initiatives that support diversity, equity, and inclusion. Alphabet also created a $310 million fund for workplace initiatives and programs spanning 10 years focusing on (i) expanding the pool of historically underrepresented technologists; (ii) hiring, progression, and retention of historically underrepresented talent at Alphabet and, in particular, Google; (iii) fostering respectful, equitable, and inclusive workplace cultures; and (iv) helping historically underrepresented groups and individuals succeed with their businesses in the digital economy and tech industry. The Court approved the settlement on November 30, 2020.